Patanjali STP Analysis...10 GROWTH PATH................................................... 5 SEGMENTATON............................7 ISSUES MARKETING NEEDS TO RESOLVE....................... 4 SWOT ANALYSIS.................................................3 PESTLE ANALYSIS......................... 3 OBJECTIVES OF THE ASSIGNMENT.......................................................................................................................................................................................... 10 REFERENCES............................................................................................................................................................................Contents INTRODUCTION............................................................... TARGETING AND POSITIONING................................................. 11 ....................... honey. Ramdev focused on Yoga while Balkrishna assumed responsibility of spreading Ayurveda medicine.000 crore. clocked a turnover of about Rs 5000 crore. this captive market was among the first to buy and use its products.but Baba Ramdev appears to have struck the right pose in both. particularly farmers Crores) economically through the promotion of these 2009-10 163 products. An unlikely combination of . believes in the philosophy of swadeshi (home grown) and above all considers Baba Ramdev as their ideal. as per the company filings and industry sources. Acharya Balkrishna is currently the Managing Director and major stake holder of Patanjali Ayurved Ltd (92%) but the driving force behind Patanjali Ayurved Ltd is Baba Ramdev. CEO. skin creams.200 which values health. The company currently has a market valuation of ₹30 billion (US$450 million). After launching toothbrush.Baba Ramdev forms this company in 1997 by collaborating with Acharya Balkrishna. we have selected Patanjali Ayurved Ltd. The company sources products directly from farmers and cuts on intermediaries to boost profits. healthy products.a Haridwar based Indian FMCG. Currently. 2013-14 1. Compared to other multi-national company products. . Patanjali expects to clock a turnover of over Rs 10.Introduction In regards to the MCRM Group Assignment. face creams and other products in North India's open market. dental care. which has registered phenomenal growth in the last 5 years. juices. The Company was originally formed as a private limited company on 13 th January. Patanjali is present in almost all categories of personal care and food products ranging from soaps. mustard oil. During the current fiscal.000 market is health conscious. It manufacturers almost 800 world class. sugar and much more. pranayama and 2014-15 2. biscuits. ghee. looks out for affordable products. these products would be cheaper by at least 30 per cent. This marks a phenomenal 67% jump from the previous fiscal year. Yoga Guru. This captive market developed instant loyalty to Brand Patanjali. For fiscal year 2015-16. shampoos. Patanjali Ayurved Limited launched its products in South India beginning with Hyderabad. The objective Year Revenue (In was to empower people. 2010-11 317 Baba Ramdev and Acharya BalKrishna knew 2011-12 446 that they have created a captive market with 2012-13 850 their efforts since last one and a half decade.. Sanskrit and Vedas in 1990’s to manufacture Ayurvedic medicines. When Patanjali Ayurved Ltd launched its products in the Indian retail sector. Pittie Group. up from about Rs 2000 crore a year earlier and Rs 1200 crore in fiscal 2013. Patanjali Ayurved Ltd.YOGA for inner peace and FMCG for external beauty . toothpaste. an ascetic and yoga guru of Indian origin.006 above all brand Baba Ramdev. according to Aditya Pittie. also known as PAL . honey. a scholar of Ayurveda. 2007. balms. 2006 and consequently converted into public limited company on 25 th June. This captive 2015-16 5. yoga. To analyse the current STP for Patanjali Ayurved Ltd. which offers trusted Ayurvedic products. To identify the gaps/opportunities that the company can target fresh. PESTLE Analysis Patanjali Ayurved Ltd (PAL) has grown since its inception. which affected or might affect in future are analysed below using the famous PESTLE analysis. With the brand and trust of Patanjali. Government is promoting Ayurveda through “Ayush – Ministry” to promote Yoga. hence affecting the final price of the products. Since the raw materials for the manufacturing are from the natural environment and the company focuses only in retailing in India alone. This makes the products costly in the market.4 US $ million in 2003 to 9000 US $ million in 2016 acknowledges the above statement. Ayurved and other traditional and complementary medicines. Implementation of Goods and Services Tax GST) will also help PAL. Social The people of India are becoming more health conscious. Some of the factors or forces. That gives Patanjali a huge boost as it itself claims it to be an Ayurvedic company. Rise in healthy FMCG products from 2284. Economic Inflation rate affects the buying nature of consumer.Objectives of the Assignment To conduct PESTLE Analysis for Patanjali Ayurved Ltd. Political Present political climate is favourable to Patanjali as it is close to government and it is following government initiative like ‘Make in India’ campaign. To propose positioning strategy for the chosen target segment(s). Government’s taxation policies affect the cost of the input products. Higher tax rates and interest rates affect the cost of capital adversely increasing the manufacturing cost. it has formed the potential substitute. This particular trend opens up the market for PAL. The affordable price also helps . the factors like fluctuating global economy and currency fluctuations have no significant impact. and want to consume organic products. people are looking for cheaper and effective substitutes. PAL input costs increases or decreases based on the taxation policies of the government. With inflation rate increasing continuously. 58. This particular trends enhance the scope of companies like PAL. steadily climbed to around 48 in 1980. is tal seasonable herbs and their locations. Patanjali has in house R&D facility. Technology can help to construct area where we can do the artificial farming for those herbs by maintaining temperature according to the herbs. The improvement in life expectancy attributes to better diet and health consciousness among people. Technologic Government has created favourable climate for R&D work in al country. Some herbs are available only on the mountains at very high location and some of them are not easily identifiable. In India. Environmen The main problem.5 in 1990 and around 62s in 2000. which used to be around 42 in 1960. which Ayurveda has to confront. new herbs are being notified and being used in the new medicines. using which they are developing new products in Ayurvedic way. Few examples are as below: o For the manufacturing unit in the company. which are available in winter season. Quality assurance needs to be fulfilled by those medicines. Company is also working for new farming ways. With the help of the available technology. Legal There are several rules and laws for Ayurvedic medicines and the process by which medicines are prepared: o The Medicine Central Council Act-1970. it has high frequency drier unit for quick liquefaction a fluid wed processor. There are many herbs. better options are being created in the company. . o The Drugs and Cosmetics Act 1940 and rules made thereunder o The Drugs and Magic Remedies Act 1954 and the rules made thereunder. o Tablet compressing device with the capacity for preparing one lac tablet per hour o High speed auto coater for coating the tablets o Utility centre has been set up in the production unit has two generators with boilers and compressors o Company has PLC controlled packing machine having capacity of 300-400 volts with automatic blister packing equipment With the help of biologists and technology. autumn season or in summer season. which are being prepared and laws are there for this process as well. average life expectancy. them to cover the whole market size. 071 2 Sun Pharmaceuticals 7.06.14. SWOT Analysis Strength Weakness Low Operational Cost Strong global competition.000 Patanjali Swadeshi Kendra. Sl # Company Operating Cost(Rs) 1 Patanjali Ayurved Ltd 72. of people Policies related to Cultivated Export Potential herbs Strength Low Operational Costs: .790 Patanjali Arogya Kendra.22.The Company enjoys low operational costs and more operational profit percentage compared to many other big players like Ranbaxy and Sun pharmaceuticals. As the company itself calls itself a Ayurvedic company.16.000 Large Distribution Network: o PAL has an extensive distribution network spread across the country with more than 3. the company has changed its sales pattern and its products are available in the open market through more than 70.14. Large Distribution Network Low export levels Good relation with Government. Less promotion Huge dependency on Baba Ramdev Opportunity Threat Untapped rural markets Replication of product Rising income and Purchasing power Infamous political attacks. it is favourable to environment and has no side effects to people nor environment. The wide distribution network ensures ample visibility and availability of products throughout the country augmenting the sales of the company.70.088 Patanjali Chikitsalya and 11. The super distributors route the products to distributors who sells the products to retail shops. 1. o The company has appointed around 60 super distributors across the country. These outlets operate as franchisee stores opened by third parties. o Patanjali Chikitsalya works as miniature clinics with specialized consultant available. 83.400 3 Cipla Ltd 6. which further enhances the value proposition of the outlets.000 retail outlets across India.800 4 Dabur Ltd 5. The change in the supply chain has led to a positive impact on the business profile of the company as . o In the last few years. Presently the company is focused only in India. The trendz and statistics have proven that many companies have helped due to promotion. Opportunity Untapped Rural Market: Though the company associates itself with rural India the market penetration of PAL is weak in such areas. Ayurved and other traditional and complementary medicines. due to the presence of well-established players in the market like BACFO. reflected in increasing sales through ensuring wider availability of the products. Neighbouring countries can also be a good potential. Promotion will help increase its visibility in the market. Replication of Product: Since the product are general in recipe or components. Government Support: Central Government is promoting Ayurved and Yoga.e. Himalaya etc. Export Potential: Europe and America have always looked towards India for effective Ayurvedic products. PAL can expand globally by establishing its market even outside India. needs a lot of strategy and hard work. Weakness Strong Global Competition: PAL has been extensively doing well in India but to establish it globally. PAL has kept itself out for some anonymous reasons. This can lead to many small companies to emerge and can increase competition. . This can hamper their main USP i. Rising Income and Purchasing Power: The purchasing power of people have increased.Where the major companies depend on promotion for its sales. Threats Political attacks: There have always been attacks from the political parties on companies for adulteration. A rural market share is always there to be penetrated. trust. The major visibility of the company is in urban areas where the people are more health conscious. Government of India has a separate “Ayush – Ministry” to promote Yoga. people can pay a bit more than what it is being sold now. So. Huge dependency on Baba Ramdev. Low Export Levels: . Less Promotion: . Extensive growth globally has many hindrances from export policies. they can be easily replicated. PAL can take a bit of liberty to increase the price. to international rules in the field of medicines etc. Especially in the sector where they are doing business. Mass customization is a marketing and manufacturing technique that combines the flexibility and personalization of "custom-made" with the low unit costs associated with mass production. Policies: Since the company uses cultivated herbs as raw materials. Customer expectations of the service can be divided into two types: Desired service: Desired service is the service that a customer desires and expects to get. Adequate service: Adequate service is one in which the minimal level of service which a customer is willing to accept based on his perception of service acceptability. Targeting and Positioning Patanjali Ayurveda Ltd is targeting the value conscious customers with positioning based on natural. Segmentaton. healthy & ayurvedic product. any policies in future related to them can create hindrance in the growth of the company. Due to the Mass Customization. The service provided by Baba Ramdev’s Patanjali is synchronizing well with the desired service expectations. There is no specific segmentation for Patanjali Ayurved Limited. Patanjali targets: Everyone who wants to live healthy Anyone suffering from any disease The most important promotional activity involves yoga campaign by Baba Ramdev and the Patanjali trust. It has taken up the Social Responsibility to make people . It follows “MASS CUSTOMIZATION”. Baba Ramdev's live yoga classes have become a passion to not only citizens of India but all around the globe. The diseases for which Indian population spends is much more in hospitals. Baba Ramdev's Patanjali Medicines are claimed to be completely natural. Swamiji recommends patients to also do pranayam. with no or very little side effects. pranayam and yoga. They want people to make our country economically stronger by making them purchase medicines made in India by Patanjali and not medicines made abroad. Patanjali as a brand Talks about “Being healthy is my birth right”. Incase medicines . Patanjali Yogpeeth is fully utilizing the historical Indian roots i. spirituality to competitive advantage. The literature on advertising has traditionally emphasized the persuasive nature of advertising: its purpose is to alter consumers' tastes for established brand names or company reputations. It is a well- established fact that advertising affects consumers. but it is claimed to be true that this is the cheapest and the only complete cure to most of the so called incurable diseases.e. Baba Ramdev has declared on Indian and International TV Channels that pranayam and yoga are the complete and natural cure for all kinds of ailments. Baba Ramdev’s popular opinions of advertising and at the same time not advertising is unique in its nature.healthy. Besides medicines. He tells people not to lose hope and not to depend on costly treatments marketed by various foreign brands. They have proven extremely effective in fighting all forms of sickness and diseases. Hence. a more-advertised good is preferred over a less-advertised good. Baba Ramdev has been giving importance on pranayam and yoga dimensions to target the mass population worldwide. It helps in improving life at low cost. This is the positioning strategy used by Patanjali. Whatever be the case. On the other side. which are made by potent herbs that are available in the Himalayas. which will strengthen the immune system and quicken the healing process. Baba Ramdev's Patanjali Ayurved employs penetration strategy and cost of goods is very less. The organization is engaged in various good activities which are of great benefit to the society. Patanjali aims at providing excellent quality and safe medicines at a very cheap price compared to other foreign brands. treat all the ailments completely with cheap and quality medicines. created by Baba Ramdev. to sell its own products in the market. It is amazing. it is very important to get a clear idea about customer's expectations from a product they are willing to consume. which are bringing negative recognition to the brand and thus can result in loose of trust and bad public relations. Patanjali Yogpeeth is not only selling its ayurvedic medicines. reply to the people's concerns and provide a solution to maintain a healthy relationship with them. Hence. within a very short span of time. Issues Marketing Needs to Resolve USER COMPLAINTS: There are numerous complaint unattended on the complaints forums. With UN declaring official World Yoga Day the Patanjali products can only expect to grow in India and Internationally . Moreover. they are available at the Patanjali Ayurved and these packages of medicines are cheaply available. The medicines can cure most of the diseases from a simple cold to cancer. But with . Marketers need to take up those forums. They have a presence now in international market.are still required then. it can be said that Patanjali Yogpeeth has succeeded in creating a positive image through ancient Indian roots and using it to sell the products in the market. Therefore. BIG PLANS BUT FEW RESOURCES: Big plan is to make Patanjali a global Indian Brand also aiming to acquire big market share of FMCG in India. Patanjali is a huge success and is well known not only at national but also at international level. MISLEADING AND MISBRANDING: Recently few irregularities have been found in noodles packaging where some firms declared the Patanjali Noodles are unsafe to use. the organization is engaged in various good activities which are of great benefit to the society. It is trying to imbibe good character in masses with good health through yoga and ayurveda. but also diversifying itself through selling of FMCG products. Intensive market research is the key to improve the existing products or to introduce new products into the market. INTENSIVE MARKET RESEARCH: Apart from the common health issues which are addressed by PAL products for middle age people. Apart from yoga programmes in which Baba Ramdev promotes the Patanjali products. where people are fed up with medicines that cause side effects. it is hazardous for PAL for underestimating the power of social media. but around the world. and HUL etc. worse than the actual disease that they are supposed to cure. while continuing with the intensive marketing strategy. which can easily grasp attention. Growth Path Yoga and Ayurveda together as a combination is the trend seen in the health conscious population of the world. After successful awareness of ayurveda and Patanjali among people. PAL should come up with similar promotional campaigns and increase the number of customers. Relying on mere Yoga Programmes for nationwide recognition is quiet impractical. and in place where herbal medicines are becoming the trend. unsatisfied whole sale retailers and many legal cases pointing the branding and patent issues. will help in reinforcement of the brand's ultimate message. are ruling over the social media and continuously connecting with consumers via various forums or promotional campaigns. multi-dimensional brand experience for the consumer. Patanjali brings these two together as a daily way of life into the world population. Such kind of strategy stresses the importance of a consistent. are: Infant & Kids Care: A whole range of baby cosmetics. It is trying to set Yoga as a trend not only in India. kids medicines can be an eye catcher and with this range Patanjali can grab a good market share from its big players like Johnson & Johnson. Moreover. radio etc. Patanjali can expand its operations around the world where Yoga is followed. Johnson & Johnson. The opportunities that Patanjali sees in the marketing environment. Its best approach to market the existing products would be “Integrative Growth Strategy” and “Market Development”. A good marketing strategy to convince and compel everyone involved from distributors to consumers with a good skill set and right use of technology is the need of the hour. Capitalising on this opportunity. . It is also setting a new trend of marketing with digital marketing. seamless. Patanjali should target particular segments where chances of recognition are high. USING SOCIAL MEDIA TO GENERATE CUSTOMERS AND REVENUE: In this era where major players like Himalaya. Some of the segments. baby health drinks. limited resources and lack of guidance PAL is already struggling hard to maintain existing online store. They should invest more in digital marketing. PAL should sub-divide the current segment-Middle Aged people (Generally in age group 30-65) into further classes as well as introduce more segments and products related to these segments. Himalaya etc. print ads. Ayurveda and Yoga do not have any side effects. is the presence of a health conscious world. other branding efforts like TV advertisements. Divya Yog Mandir (Trust). Patanjali stores are hardly visible in other parts of the country.scribd. Teenagers: Various Health Supplements required at the crucial growing age which can easily replace markets of Protein Shakes or other supplements preferred for good body building. Middle age women: Falling health and their increasing incurable diseases is an attractive segment where investing time and money can reap good results. In such a scenario.com/companies/ramdevs-patanjali-plans- asplash/article5414874. Ayurvedic tonics for teenagers to cure acne and puberty related problems will also attract numerous customers who are looking for herbal options. References Patanjali Yogpeeth .thehindubusinessline. available: http://www.com http://www.divyayoga. healthy &ready-to-eat snacks would be a big success in the cities where there is lack of time and for students.net/kumardevk/marketing-stretegies-by-babaramdev? next_slideshow=1 http://timesofindia. Moreover. is also an attractive sector.com/doc/61780413/Study-on-Patanjali-Yogpeeth-With- OtherPharmaceutical-Companies#scribd http://www. market is open for new entrants.slideshare.slideshare.com/business/india-business/Ramdev-expands- empirebeyond-yoga-to-FMCG-business-poised-to-touch-Rs-2000cr- thisfiscal/articleshow/45861809. Healthy & Ready-to-eat snacks: After the fall of Nestle's Maggi. which can aid the women in healthy delivery and post-natal care. people are unaware of such a brand.cms http://www.indiatimes. Pregnant women or post-natal care: Entire range of products. Patanjali has made its mark in the Indian market of ayurveda medicines but the brand is familiar only in the Northern parts of the country.net/RaghuvendraSinghPari/presentation-for- launchingpatanjali-yogpeeth-2 http://www.ece . Store visibility and placing their products in normal retail and pharmaceutical shops will increase the awareness as well as accessibility to the consumers.